Dreamweavers

Dreamweavers

by Ron Burke

There is a reason that economics is taught in school classrooms. Its to provide every American with a basic understanding of one of the backbone principles of the nation. It is called free enterprise, and represents a foundation or building block of how the great United States industries and corporations were started, and that is with private or personal investment.

The entire concept of private enterprise is that business should be free of government control, other than regulations to protect the health, safety, and welfare of public and employees. Many feel that through various changes in laws and thinking, that the free enterprise system in America has been gradually eroding as government involvement or interference has been slowly crawling into the picture.

Government, whether local, county, or state, has a definite obligation to encourage and promote economic development, but the question arises, to what extent should public monies be committed and directed to fund private projects, especially during economic stressful times when so much revenue is needed for much-needed and costly infrastructure repairs and replacements, water projects, besides other essential programs and services..

Writers such as Mark Twain and Mike Royko would weave stories about fast, smooth-talking types who would take financial advantage of a naive public and egotistical politicians. But the real game may not always be that deliberate or obvious.

A majority of taxpayers and public officials understand and favor attempts to provide legitimate tax breaks and other types of land or utility incentives to companies that want to locate in an area or community. But the problem is that in recent years, those expectations have increased to the point of becoming arguably excessive and potentially disadvantageous to the public entities. Sometimes companies or developers come to the table with virtually nothing and want much in return up front, with no guarantees of their success.

It seems to have gotten to the point where just about anybody can sit down, conceive a project, and write up a proposal full of ideas with no documentation or quantification required about its likelihood to become reality. Just saying you want or hope to bring in retail or other business does not mean it will happen. Just because you intend to offer sites to build homes for sale or lease does not mean that the demand or value is actually present. Proposals should not be viewed as actuality.What is particularly disturbing is a pattern apparently being followed by some developers around the country where they are allegedly relying on now discredited market studies to advance their projects, and some realtors who seem to be parroting those same invalid studies to push for project approval because they might like to also be associated with a deal in some way. It can possibly get even more complicated .

Across the state and nation, some banks have reportedly found themselves drawn into allegedly questionable major loan situations that were marginal credit risks at best. They entered into these loans for various partnered private business projects with municipal or county jurisdictions, without sufficiently establishing the viability of the project or the veracity of the supporting information and data being provided by developers .It also places local governments in a difficult position when they are asked in legal documents to verify or attest to the claims being made by a developer related to the need and assurance of success for a submitted proposed project.

Those private investors and developers who have taken an entire risk with their own resources and without public assistance, remind us that the role of the government in free enterprise should be very limited and restricted. They feel that the basic purpose and intent of government incentives is being compromised, that private investment interests are not being protected, and that the fiscal stability of the public sector is being threatened by unjustified financial expenditures. At the very least there should be caps placed on how much local entities spend on extending assistance to given projects.

Economic and other incentives do have their place, but they must be carefully measured against the practical feasibility and workable and solvency of given projects. There must be limits on how much taxpayer dollars local governments will invest in proposals , Dreams don't always equal reality. That delicate balance must be achieved. ﻿